Equity Market
Equity Market is the cash segment where shares of listed companies trade on recognised exchanges such as NSE and BSE. The beginners module tests trading mechanics, settlement, regulation and costs rather than stock-picking.
Core rules
- SEBI regulates the market; exchanges run trading and surveillance; clearing corporations guarantee settlement.
- Normal session is 9:15–15:30, with a pre-open call auction from 9:00–9:15.
- India uses T+1 rolling settlement for equity delivery: trades settle on the next working day.
- Shares are held in dematerialised form; you need a demat account and a trading account.
- Price bands and circuit filters apply; order types include market, limit and stop-loss.
Worked example
You buy 100 shares at ₹500 and sell at ₹520. Buy value ₹50,000; sell value ₹52,000; gross profit ₹2,000. STT on delivery is 0.1% on both legs: ₹50 + ₹52 = ₹102. Brokerage at 0.05% each side: ₹25 + ₹26 = ₹51. Net profit before exchange charges and stamp duty = ₹2,000 − ₹153 = ₹1,847. The reasoning: costs apply to both buy and sell, so gross P&L overstates the result.
Traps that cost marks
- Calling settlement T+2; the standard equity delivery cycle is T+1.
- Forgetting STT on the buy leg for delivery trades.
- Assuming one market lot fits all stocks; lots vary by scrip.
- Using a market order in an illiquid stock and ignoring impact cost.